Today mobile payment darling Square tweeted that it hit a milestone: "Just as small businesses are growing with Square, we're growing with them: Over 1 million merchants now accept credit cards."

Co-founder Jack Dorsey tweeted in response: "To put that in perspective: there are only 8 million merchants who accept credit cards in the US. @Square has added 1 million."

The young company has shipped 800,000 card readers to merchants and is processing $2 billion in payments a year, according to Square. Earlier this year, it released a new Square Register and Card Case products.

Square faces competition from Google's Wallet for delivering local deals, though Google's new Wallet platform is meant for larger retailers not the small business owners market. While PayPal has already proven itself, Square still needs to. Customers have to trust the that the dongle attachment is safe to use through a third-party payment processor. Merchants seem to love it (or most do anyway).